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Clean Air Act Trips Up Sunflower's Coal Plant Deal in Kansas

The EPA issued a letter today stating that Sunflower Electric must restart the permit application process if it wants to build an 895 MW coal plant in Kansas, a permit the company thought it had already secured in a back room deal with the governor.

The move by the EPA's Region 7 administrator highlights the ability of the federal Clean Air Act to protect the public health and welfare, despite political horse trading.

Kansas Gov. Mark Parkinson had negotiated a private agreement with Sunflower for construction of the plant, and subsequently the state Legislature made the agreement part of a law that the governor signed on May 22.

Today, however, the EPA informed all stakeholders that the plant still must meet requirements of the Clean Air Act. The agency laid out in detail what those requirements are in a six-page letter (attached below).

"This means that the governor's back room deal will be forced into the light of day for the public to examine," said attorney Amanda Goodin of Earthjustice, a public interest law firm that has been representing the Sierra Club in the case.

The last time Sunflower held public hearings was back in 2006. Advances in technology and new legal rulings have since changed the landscape.

Sunflower has also substantially changed the design of the plant it wants to build since first applying for a permit to build three 700 MW coal plants.

The EPA concluded that all these factors together require a do-over of the application to comply with federal law.

"The redesign of this new unit, as well as public input on the new project, will need to be considered in determining the form and content of any final permit," William Rice, the acting regional administrator wrote.

Sunflower does not see eye-to-eye with the EPA. Asked about the letter, Wayne Penrod, an environmental engineer at the company said:

"The EPA says it is a new project and we contend it is a revised project. We're not changing much. The plant is smaller, that's about it. We're going to start where we left off."

Cynthia Hertel, a Sunflower spokesperson, added that the company was involved with meetings with EPA and so was not surprised by the letter.

One key issue is whether the proposed plant meets Clean Air Act requirements for using the best available control technology (BACT) under the Clean Air Act's Prevention of Significant Deterioration (PSD) program. The letter cites a number of differences between the proposed 895 MW plant and the three 700 MW plants it previously wanted to build. These included a relocated stack, additional scrubber modules, and altered coal handling facilities. The changes could impact the location of significant emissions and fugitive emissions on air quality.

For its previous permit application, Sunflower conducted an analysis of the soot that would emerge from the smokestacks of two 700 MW plants it most recently wanted to build, relying on a measurement of particle size called PM10. The EPA recommended – but did not require – that Sunflower conduct the new analysis using a smaller PM2.5 standard, which measures particles a quarter of the size. A number of legal rulings over the last three years has changed the applicable standard, and EPA wants a fresh look.

The agency also recommended an analysis of whether the proposed plant ought to employ Integrated Gasification Combined Cycle (IGCC) technology. IGCC is the cleanest burning technology under development for power plants, one that can recover and use about 20 percent more heat that otherwise goes up the smokestack. EPA wants Sunflower to put in the permit record its evaluation of IGCC technology, and if the company determines it is not feasible to utilize IGCC, EPA wants to know why.

The letter also requires an air toxics analysis, something that was not required in 2006. As a result of a legal ruling in the intervening years, the Clean Air Act now requires a case-by-case air toxics analysis to measure acid gases, mercury and other toxic emissions as part of the permitting process. The required analysis allows EPA to establish limits on these toxic emissions and require power plants to install maximum achievable control technology.

"A lot of questions still need to be answered," said David Bryan, an EPA spokesperson. "It's an entirely different project than Sunflower submitted before, and we must do our due diligence under the Clean Air Act. The public deserves a right to have a new process to look at the details."

Kansas has approval from EPA under Clean Air Act provisions to implement a PSD program on its own, but it must comply with federal requirements. EPA today spelled out what those requirements are. If they are not met, they could be enforced through various backstop provisions in the federal law. For example, Section 167 allows EPA to issue a cease construction order.

EPA officials said they have yet to see a completed permit application from Sunflower for the power plant. The letter today was issued prospectively to put the state, and Sunflower and its partner in the project, Tri-State Generation and Transmission, on notice of what is needed. The timeline for compliance is in Sunflower's hands.